Actuarial Estimates Of China’s Implicit Pension Debt

Rapid growth of the elderly population result in the extremely large pressure of the pension system. Early 90s in 20th century,China began to reform pension system, in order to adapt to the market economy. Since Pay-As-You-Go pension system had changed into Partial-Funded pension system, the Implicit Pension Debt forming, abbreviated as IPD.The paper is divided into five parts, including the introduction, the history and current status,actuarial theory, the model estimates and conclusions. In this paper, we will basis on the analysis of the previous studies on IPD and document [2005] No.38 to build the actuarial model of IPD so that measuring the size of IPD in 2010 and then reach the final conclusion.The first chapter is introductory. In this chapter, the Main content is the interpretation of some basic problems and a brief description of the article main points, such as the research background, research framework, modeling ideas and calculation methods. Then, pointed out that the innovation of this paper. Finally, made the literature review of domestic and foreign measured on the IPD.The second chapter analyzes the causes of China’s Implicit Pension Debt. This chapter describes the development of China’s pension system and the reform process of the pension insurance system from Pay-As-You-Go into Partial-Funded. This chapter then analyzes the emergence and dominance IPD root causes and classify the structure of IPD.The third chapter is to build the IPD actuarial model. This chapter first outlines the theory of pension actuarial model. And in accordance with the National document [2005] No.38 participate in the pension plan is divided into "old", "transitional middlemen", "new middlemen" and "new".and the "new middlemen " is divided into the "new retirement middleman "and "new service middleman ", then IPD calculation model are established. The fourth chapter is to Measure the IPD. Insured in accordance with ChapterⅢ, respectively, the classification of workers for the " old ", " new retirement middleman ", " new service middleman " and " new ". The total size of IPD was estimated as the sum of all parts of the IPD amount, and then compared with other research results. Finally, the chapter analyzes trends of the IPD scale to 2067 and points out that the IPD will not always exist, as the final " middlemen " die, it then disappear.The fifth chapter is to make the Conclusion.This article summarizes the main steps and the entire process of the IPD estimated.